Italy PMI December 2016

Italy: PMI hits six-month high in December

January 2, 2017

The IHS Markit manufacturing Purchasing Managers’ Index (PMI) rose from 52.2 in November to a six-month-high of 53.2 in December. The index thus moved further above the 50-threshold that separates expansion from contraction in the manufacturing sector.

December’s result mainly reflected a stronger expansion in output and new orders. The pace of growth in both new orders and output was the highest in six months and was fueled by stronger demand in both domestic and external markets, with new export orders expanding at the fastest pace since April. In addition, manufacturers’ purchasing activity increased and more jobs were created, which in turn contributed to a decrease in backlogs of work. Regarding price developments, input prices increased at the sharpest pace since February 2012, most likely reflecting higher prices for row metals, and led to the second rise in output charges in almost a year.

Phil Smith, Economist at IHS Markit, added that, “the manufacturing sector in Italy ended 2016 with an upturn in performance […]. More jobs were also created, but with price pressures mounting, firms will need to be increasingly resourceful to keep pace with demand while controlling costs.”

FocusEconomics Consensus Forecast panelists see fixed investment growing 1.4% in 2017, which is unchanged from last month’s estimate. For 2018, the panel expects fixed investment to increase 1.9%.

Industrial output grew 0.1% in July on a month-on-month seasonally adjusted basis, following the 1.1% expansion registered in June and beating analysts’ expectations, which forecast a 0.3% contraction.

The IHS Markit Manufacturing Purchasing Managers’ Index (PMI) rose to 56.3 in August from 55.1 in July, the highest level in six and a half years and above market expectations of a slight increase to 55.3 points.

The National Institute of Statistics’ (Istat) consumer confidence index stormed to 110.8 points in August, up from July’s 106.9 points and comfortably beating market expectations of 106.9 points.
August’s reading reflected a broad-based improvement in all of the index’s sub-categories.